The primary objectives of this study are (1) to develop a comprehensive reporting system for hospitals, meeting requirements of all state programs, (2) to utilize the reporting system to investigate possible economies of scale and factor productivity at departmental levels, and (3) to evaluate hospital utilization at service area levels in light of hospital costs and performance patterns. The project intend@ to develop a reporting system and methodology that would provide a sound basis for regulation (economic control and planning). All state data requirements would be consolidated into one comprehensive questionnaire and procedures developed to prepare reports for individual governmental agencies. Using data on 50 hospitals collected through the Hospital Effectiveness Demonstration Project, cost and production functions, controlling for patient mix variation, would be specified and estimated at the departmental level. During the second year, the analysis would be continued using data available through the Hospital Disclosure Act. Utilizing these data and 1970 census data, demand models would be developed and integrated with cost and production models. Demand facing service areas and individual institutions will be evaluated.